50p tax rate - perception or impact

[StraferJack]

I must be. Because I can't quite see how some people are saying "keeping the 50p rate is pure ideology and nothing more - it raises very little of any note " and at the same time say "announcing it's removal is also announcing cutting public services, sacking union workers "

But I will restate - if retaining it serves no purpose other than political, I'd support it's removal. But it isn't JUST a tax on the rich if it provides an avenue to not cut a public service or keep "union" workers (whatever they might be in this case)

Now you can argue which public services are required or not in general terms - but if you are going to use the current deficit, austerity measures and saying "we are all in this together" as a cloak to remove services you are ideologically opposed to, that's different

And any argument which says the rich pay 100 times more than the poor (in the 200k v 13k a year argument) is just - well I don't know what it is actually. It's factual and truthful but misses the point by a million miles. Paying 100 times more in tax contributions than someone else means you are in a position to do so AND remain absolutely oblivious to the brutal cuts and rising food costs. You are still reaping the benefit of any hard work you perceive to be doing above and beyond someone working 60 hours a week for their 13k salary. Relax - enjoy life

[Huguenot]

It is political. Of course it's political. Politicis has nothing to do with rationalism, and everything to do with motivation.

HMG's annual budgie is about 750bn. The 50p tax rate generates about 1bn a year That's the difference in a the price of a pint between 7.49 and 7.50. It's not significant.

The 50p tax rate has no impact on cutting public services or sacking union workers, but stupid crazy thickheads (i.e. most of us) will think it does. That's life.

So cutting services at the same time as cutting 50p rate? Light the blue touch paper and retire...

As for 'all in this together'. That's the point. We're not in it all together at all. One guy earning 150k a year is 'all in it together' for 60,000 a year, and a guy in the wood shop is 'all in it together' for 800 a year.

Fine, that's progressive taxation. Just don't call the guy a greedy cock when you're fleecing him.

And I wouldn't patronise them either. Taking 60,000 a year off someone, then calling them a greedy cock, but 'calm down be happy' is the kind of thing that gets people punched in pubs ;-)

[StraferJack]

but that makes it sound like the guy in the wood shop is The Big Winner, or at least at an advantage. Do you suppose they would be happy to swap positions? Do you suppose the guy in the wood shop would be so aggrieved?

It's like those people who win the lottery - "all my numbers are up - I won 20 million!! Oh no wait - someone else had the same numbers, I only won 10 million.. goddammit!!"

And people who clear 100k after tax, punching people in pubs because THEY feel hard done by?? Not a great look

[Marmora Man]

StraferJack Wrote:

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> But surely the reason private firms appear better able to provide healthcare in your eyes is their ability to not have to deal with the volumes the nhs does, as well as being selective.

Actually, I'm not saying that private healthcare is better, in absolute outcomes it's much the same, altho because of the elective nature it's usually better planned and calmer. I recognise the argument that it doesn't have to deal with the volumes. What I propose is for the NHS, in all its variety, be run by the private sector and funded through taxation and / or a social insurance process. That way it remains free at point of delivery but can be made far more efficient. My wife still works in the NHS, I have worked in it - now work alongside it. I know where the savings can be made - I know where the inefficiencies are.

> But it should also said there are areas where we agree - "rationing certain types of healthcare by making people pay a portion of the cost (IVF, tattoo removal, comemtic surgery, bariatric surgery for example)". I might not agree with all of the examples but taking some of the more elective procedures off the list is both a saving and doesn't require costly restructuring.

Agree - this is one of the areas of immediate saving open to the NHS. Others might be to move off the national payscale allowing hospitals to pay more for scarce staff and less in areas where the cost of living is lower. Greater utilisation would be a good idea as well - in the private sector theatres are available for 12 hours a day (minimum) for 5.5 / 6 days a week and, on occasions, 7 days a week. In the NHS 8 hours a day for 4.5 days a week (apart from emergency) is good going. Ditto imaging, pathology, pharmacy, stores support, admin support and so on. Most major hospitals and certainly almost all "bog standard" DGHs effectively close for business on Friday afternoon and don't resume, apart from A&E, until 10.00 Monday.

The NHS could also reduce the ridiculous amounts of paper that flow backwards and forwards to manage even the simplest matter. Let professionals manage but don't ask them to prove and record every single decision they make. Nurses should spend more time with the patient than in writing up the otes - these days the ratio has been reversed. The endless committee meetings, the reluctance to make a decision, the tendency to "delegate upwards" and the general reluctance to make a decision are all paralysing and costly.

[david_carnell]

Marmora Man Wrote:

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> Agree - this is one of the areas of immediate

> saving open to the NHS. Others might be to move

> off the national payscale allowing hospitals to

> pay more for scarce staff and less in areas where

> the cost of living is lower. Greater utilisation

> would be a good idea as well - in the private

> sector theatres are available for 12 hours a day

> (minimum) for 5.5 / 6 days a week and, on

> occasions, 7 days a week. In the NHS 8 hours a day

> for 4.5 days a week (apart from emergency) is good

> going. Ditto imaging, pathology, pharmacy, stores

> support, admin support and so on. Most major

> hospitals and certainly almost all "bog standard"

> DGHs effectively close for business on Friday

> afternoon and don't resume, apart from A&E, until

> 10.00 Monday.

I don't want to break rules on veering off topic but is this not because of staff contracts. If you want elective surgery staff (surgeons, doctors, nurses etc) to work through the night and through weekends you have to remunerate them properly. And we wither don't have the will or the means to do that.

> The NHS could also reduce the ridiculous amounts

> of paper that flow backwards and forwards to

> manage even the simplest matter. Let professionals

> manage but don't ask them to prove and record

> every single decision they make. Nurses should

> spend more time with the patient than in writing

> up the otes - these days the ratio has been

> reversed. The endless committee meetings, the

> reluctance to make a decision, the tendency to

> "delegate upwards" and the general reluctance to

> make a decision are all paralysing and costly.

Whilst in principle I agree with you, I would highlight two issues. Firstly, the reasons for endless paperwork trails and their continued rise is the ver present fear of litigation and blame. We demand that our medical staff are held to account for the slightest mistakes. In such a climate it is not surprising that there is a desire to create a paper trail that can exonerate innocent parties.

Second, I don't think the NHS or the public sector at large are unique in this. Having worked in large and small private sector organisations (one of less than 20 staff, one of thousands around the world) the scale of paper pushing and bureaucracy was similar in all of them. I think it is symptomatic of modern office life more than it is of public sector inefficiency.

[Loz]

I don't want to break rules on veering off topic but is this not because of staff contracts. If you want elective surgery staff (surgeons, doctors, nurses etc) to work through the night and through weekends you have to remunerate them properly. And we wither don't have the will or the means to do that.

Whoh - nurses I'd agree, but most doctors and surgeons get near to, if not over, six figures. How much do we have to pay them?

[StraferJack]

How much do you want to pay them?

[mockney piers]

depends, how much tax to we get to raise off of that sixth figure ;)

[david_carnell]

So suddenly, because you earn six figures, you have to work any hours demanded of you?

Blimey you guys swap sides quickly. Are you on the sides of high earners or not?!

[StraferJack]

I think the beef they have is if the high-earner is earning directly from their taxes

[mockney piers]

I wasn't aware I was on a side on this one, let alone swapping.

If i'm going to be called out on it, back to the original question I'd go perception. The figures raised aren't insubstantial in an absolute way, but in terms of the wider policy they are marginal meaning such palarver is because of the political not economic impact.

[Marmora Man]

mockney piers Wrote:

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> I wasn't aware I was on a side on this one, let

> alone swapping.

>

> If i'm going to be called out on it, back to the

> original question I'd go perception. The figures

> raised aren't insubstantial in an absolute way,

> but in terms of the wider policy they are marginal

> meaning such palarver is because of the political

> not economic impact.

And that's the problem. Decisions made on subjective political grounds rather than objective, rational, grounds.

This could close the thread down.

[david_carnell]

I'm not that quick at typing, Piers (30wpm since you ask). My comment was aimed at those posting before you....Loz mainly.

[Loz]

david_carnell Wrote:

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> So suddenly, because you earn six figures, you

> have to work any hours demanded of you?

>

> Blimey you guys swap sides quickly. Are you on the

> sides of high earners or not?!

I'm happy for doctors to earn that sort of money. But I expect value for money in return. And yes, if you earn six figures there is a lot expected of you. It's the reason I never wanted to work in the city - yep, you get big money but the trade off is you give your life to your job.

There's no 'swapping sides' here by me. If doctors work hard they should be paid lots and a majority of that money shouldn't be clawed back in tax. On the other hand if we were talking, say, bankers I'd be still saying the same but I expect your tune may be somewhat different, DC.

PS You've not responded to my 50% challenge yet...

[mockney piers]

It being politics cuts both ways of course.

If we can agree that the policy has a marginal economic impact, then I'm a bit lost as to why so many people are up in arms about it, especially as I'm willing to bet that the vast majority of them won't ever even need to pay that extra ten p!!

It really is a case of nothing to see here, move along.

[david_carnell]

Loz - I'm not so dogmatic to suggest that if a tax rate didn't bring in any money that I'd still demand it was kept on a point of ideology.

[mockney piers]

In the light of another news story at the mo, i thought this was in an interesting insight into efficacy vs perception of why governments do things.

The story was that debris from a satellite in a decaying orbit was predicted to fall in an remote area of Lapland that was virtually unpopulated save for a few nomadic reindeer-herders.

The Swedish Gov't offered to helicopter airlift the reindeer herders out of the area, at significant cost to the Swedish taxpayer.

Hermann Bondi, a famous British mathematician and Government science adviser, heard the story, crunched the numbers and confirmed that the probability of any reindeer herder who stayed put having the satellite land on them was several orders of magnitude less than the chance they would be killed in a helicopter crash on a routine helicopter flight.

So the Swedish Govt?s decision was plain daft.

Well, that depends.

Purely on the statistics, it was a wholly illogical decision. But Bondi pointed out that the Swedes had undoubtedly factored in that if they didn?t offer to evacuate people, and the satellite then landed on someone, the headlines would scream

?Heartless and negligent Govt leaves reindeer herders to die?.

While if a chopper crashed, the headline would be

?Tragic helicopter crash kills herders?

and the Gov't would be off the hook.

[Timster]

Wow. Since I last visited we've done the whole NHS vs private sector debate (I have a vague recollection of having this argument with MM about two years ago) and now we're on reindeers.

If the 50p tax rate raised no more than an extra ?100,000 a year (after the cost of collecting etc) then I would still be in favour of it. Because if you didn't have that ?100,000 from the 50p tax rate payers then you would have to find it or save it somewhere else - maybe half a dozen teaching assistants, less money for road improvements, whatever - all things that in my book are worth more than the mild irritation of those high earners.

Arguing that it is an inconsequential sum and so should be done away with is like saying it would be a waste of time pursuing MM if he decided to stop paying his taxes because his unpaid taxes represent an infinitesimally tiny fraction of the UK's tax revenue.

Also, the VAT rise to 20% has almost certainly increased the burden on low earners far more than the 50p rate has raised the burden for high earners.

And I would like to ask MM et al, would you rather be earning ?100k paying 40p (or 50p even) or ?30k paying 20p? If the former, then case closed.

[mockney piers]

You can't close the case like that Timster because the obvious answer is "ideally ?x paying 0p, but I understand the state needs some money so the least amount possible to make it function" whilst the gov't is thinking "in reality I'm going to take the maximum amount possible without losing your vote (or residency for that matter)" and therein lies the debate about where and why those lines are drawn.

That should have gone without saying really ;)

As for the lines regards what the state should and shouldn't be doing that's a whole new can of worms.

[Loz]

Well, as I think the 40p rate is entirely fair and the point in which is applied is not too far off (actually, I think it's a bit low and should be around ?45K), so I'll take the ?100K at 40% thank you.

I'm previously made clear my thoughts about what I'd do if the 50% band ever got me.

Also, the VAT rise to 20% has almost certainly increased the burden on low earners far more than the 50p rate has raised the burden for high earners.

How so? Most 'necessary' goods are zero rated or, in the case of energy, unchanged. Zero vat on rent, transport, basic foodstuffs. Chances are most people on the lower end of the payscale don't pay much VAT at all. People at higher salaries tend to buy more VAT related stuff.

Even the IFS said that, in the longer term, VAT is a progressive tax. I never did quite understand why they thought is wasn't in the shorter term, mind you.

And the VAT increase raised a significant amount of tax. If it raised an extra ?1bn a year I would say it was a silly idea and dump it. Wouldn't you?